The co-op entered a JV (Joint Venture) with Fonterra to produce whey products in 2011.

The co-op has been buffeted by unprecedented challenges facing the dairy industry. First Milk deferred milk payments to farmers in January this year and asked their members to increase their investment in the co-op in order to bolster cash hit by the slump in dairy commodity prices.

Mike Gallacher, the co-op’s new CEO, embarked on a process to evaluate strategic and operational issues and implement a programme of cost reductions. These include proposals to cut 70 head office and manufacturing jobs.

The company is also altering the way it organises its milk pools, they will be divided on a geographic basis that sees milk fed into its manufacturing and balancing pools based on proximity to processing locations.

To improve the financial stability of the co-op, the First Milk board has also agreed a reduction of £3.3m (€4.49m) to its milk price, which will equate to an average reduction of 0.33ppl (0.45 c/l)paid to its suppliers.

Gallacher has insisted that none of these decisions have been taken lightly, but they are necessary steps in the process of rebuilding a secure and stable future for First Milk.